Markets waiting for ECB but big FX moves look to be brewing by Mary McNamara

Stocks are trading higher ahead of tonight’s ECB meeting but many FX pairs are still chopping around key S/R levels ahead of this news. A few pairs still look to be building up to major breakout moves but just waiting for a final push. Traders are watching to see whether ECB news will be just the event to provide the shove!

USDX 4hr: back under the 93 level:

EURX weekly: still above the key 78.6% fib ahead of tonight’s ECB:

S&P500: this closed higher for the day but is still within the Cloud suggesting caution. Any new close above the Cloud would be bullish though:

TC Signal:

Gold:this TC signal is up over 500 pips now but price is struggling at the $1,300 resistance level:

Gold monthly Cloud: this chart shows the significance of the $1,300 level:

Other FX:

E/U: chopping sideways ahead of tonight’s ECB. There are plenty of rumours about the size of the ECB QE package but position trading ahead of this news is a bit like gambling.

E/J: this is still trading near the 136 level. Check the monthly chart to see the significance of this level. Watch for any new breakout move away from this zone after ECB:

E/J 4hr: near 136 still.

E/J monthly: note the significance of the 136 level:

A/U: this has finally made a triangle breakdown but this came during my night (US session) as the 30 min chart shows. Price is also back below the 4hr Cloud. A move back below 0.88 might be the start of another Bear Flag:

A/U 4hr: decisive triangle break:

A/U 4hr Cloud: back below the Cloud:

A/U 30 min: this triangle breakout came during the US session:

A/U daily: is this all just more ‘Bear Flag’ action setting up?

A/J: all very ordered here and still conforming to the triangle. Price is back below the 96 level and a new TC signal has triggered BUT I will wait until after ECB and for a triangle breakout here before trading. Any triangle breakout move could be of the order of 1,000 pips though as this is the height of the triangle:

A/J 4hr: new TC signal but waiting until after ECB:

A/J 4hr Cloud: price is back below the 4hr Cloud:

A/J daily: I’ve been caught out on recent TC signals here so I’m waiting for a triangle breakout for confirmation. The triangle ‘height’ is about 1,000 pips suggesting a similar sized breakout move:

GBP/USD: still trading along the major support of the monthly triangle trend line:

Kiwi: this has pulled back to test the key 0.77 level and the 1,000 pip ‘Bear Flag’ looks to be forming up:

Kiwi 4hr: tested the key 0.77 and promptly fell away:

Kiwi weekly: is the 1,000 pip Bear Flag about to start here?

U/J: this pair is still consolidating within a daily chart triangle and within the daily Ichimoku Cloud. I had warned this pair could chop around whilst in the Cloud and that is what we’ve seen. The 118.5 level remains a key level to watch here too:

U/J 4hr: chopping either side of 118.5:

U/J daily: failure to breakout with any ECB news leaves room for further consolidation ahead of next week’s FOMC:

U/J daily Cloud: watch for any breakout from the daily loud as well:

EUR/GBP: has pulled back to test the key 0.77 level. I hope this isn’t the only chance to short here for this 2,000 pip triangle break: